It is not just banks who lost contact with their customers. So did water companies, airlines and internet service providers. Speak to people about their dealings with companies and they often talk as if they are at war with them – or they would be if they could speak to them.
Much of it is about pay. The growing gap between senior management and staff salaries, the sense that the top people were in it for themselves, led many employees to ask why they should bother. The closure of their pension schemes persuaded them that they shouldn’t.
How did companies get this way? Underlying it all, in banking and everywhere else, was an obsession with “making the numbers”. The pressure for double-digit earnings increases led to the frantic cost-cutting, the stripping away of employee benefits and the disappearance of front-line staff who knew the customers and cared enough to look after them.
It was because chief executives made the numbers that boards and shareholders were happy for them to earn unheard of sums. And it was desperation to keep on making the numbers that led financial institutions to securitise bad loans as frenetically as the bank next door.
Read the full article @ FT.com
